In last month’s column, I talked about adding franchising to your options if you are looking to make changes in 2022. An increasing number of people are aiming to start their own business as they want to take control of their future, rather than continue to fit their lives around someone else’s agenda.
Franchising can be a great option for those who want the independence of their own business but with the support, training and mentoring that comes with a good franchise.
You can see plenty of options across a wide range of industry sectors on the Elite Franchise website and of course, in the EF Top 100 Franchises list.
Once you have decided on your chosen franchise, you should then start to research in more detail, so before you get carried away with the excitement of all your new plans, take some time to go through everything carefully. After all, you will be signing a contract for probably a five-year term or more, so you need to be clear about your choices and what they mean for your future.
Your research needs to cover the franchisor and their ability to support your new business. And you should also research the territory and scope of your potential business.
You will already have started to build your knowledge of the franchise by going through the discovery process, including possibly meeting a few of the directors and staff at head office. Here are some additional things to consider, which should take your knowledge of the franchise you are looking to join to the next level:
Start with the British Franchise Association (bfa) website. The bfa provide some great resources to help prospective franchisees, including a detailed list of questions to ask a franchisor – Click here
There will normally be a limited company for the franchisor that you can research on the Companies House website, looking at their up to date accounts and checking names of the directors and shareholders.
Your franchisor should let you have a copy of the franchise contract in advance so that you can have that vetted by solicitor so that you understand exactly what it involves. You are unlikely to get any changes agreed as the franchisees should all be on the same terms but the solicitors report will help you to understand your obligations under the agreement. I would highly recommend that you use a specialist franchise lawyer, rather than the solicitor who did your will or your last house purchase.
Speak to some existing franchisees and ask them about their experience of starting their franchise. What tips can they give you about what they found challenging and how much help did they receive from the franchisor to overcome any problems?
Research your chosen territory in more detail. You can do this as you prepare your business plan as some of your research should be included in the plan. This could include:
Population and demographic information. Where are the best places to find your customer base? What marketing will you need to do and does your franchisor help with this?
Who are your competition and how do they appear to potential customers? Do some mystery shopping to get a stronger picture of how they deal with enquiries and better understand their prices.
If you need to employ staff from the outset, look at job boards to understand local wage levels and what the competition for staff looks like.
Consider what your business will need to operate, will you need premises, vehicles, stock, equipment, software and hardware, for instance?
Prepare your financial forecasts, looking at costs, sales and cash flow to see what level of funding you could need. Examine your personal finances in detail too, how much will you need to draw out monthly. It is important to have sufficient funding for the franchise right from the outset, as being short of cash will hold back your growth and could lead to the business struggling to succeed.
Your franchisor should help you with all this planning and research and may well have templates and guides to help you. But never lose sight of the fact that it is your responsibility to do your own research. This will be your business and you will be giving your time and commitment to making the franchise a success, you are not ‘buying a job’.
All this can sound quite daunting but will stand you in good stead once you launch your franchise. Part of doing the research is ensuring that this venture is still something that you actively want to do and that you get excited at the opportunity ahead. You can’t ‘prove’ without doubt that you will succeed but research gives you a great foundation for success.
Franchising offers lots of benefits compared to going it alone and it is certainly worth exploring. It will still involve plenty of hard work but could be YOUR path to taking control of your own future!
